What is GST Return?

Types of GST Returns and their Purposes

Given below are the various different kinds of GST Return Fillings and the purpose of GST returns

Regular Businesses

• GSTR-1: This return captures details of outward supplies made, including interstate and intrastate B2B and B2C sales, reverse charge purchases, and inter-state stock transfers during the tax period.
• GSTR-3B: A temporary consolidated summary return for inward and outward supplies, providing a relaxation for businesses transitioning to GST. It simplifies tax payments for the initial months of July and August 2017.
• GSTR-9: An annual consolidated tax return that reflects the taxpayer’s income and expenditure, regrouped according to the monthly returns filed during the financial year.
• GSTR-9C: An audit form required for taxpayers whose annual turnover exceeds Rs. 2 crores, mandating them to get their annual reports audited.

Businesses Registered under the Composition Scheme

• GSTR-4: A quarterly return specifically designed for compounding vendors, reporting the total value of supplies made and tax paid at the compounding rate.
• GSTR-9A: An annual composition return form filed by taxpayers enrolled in the composition scheme.

Other Types of Business Owners and Dealers

• GSTR-5: A variable return for non-resident foreign taxpayers, documenting details of goods and services sold, purchased, or imported on Indian soil.
• GSTR-6: A monthly return for Input Service Distributors (ISDs), providing information on basic details, invoice-level supply details, and ITC (Input Tax Credit) distribution.
• GSTR-7: A monthly return for TDS (Tax Deducted at Source) transactions, including supplier details, invoices subject to tax deduction, and information on other payments such as interests and penalties.
• GSTR-8: A monthly return for e-commerce operators, encompassing details of supplies made through the e-commerce platform, tax collected at source, and tax payable.
• GSTR-9B: An annual return form for e-commerce operators collecting tax at source.
• GSTR-10: A final GST return filed while canceling GST registration, summarizing all supplies, liabilities, tax collected, and tax payable.
• GSTR-11: A variable tax return for taxpayers with UIN (Unique Identification Number), providing details of purchases made by foreign embassies and diplomatic missions for self-consumption.

Does GST have to be paid monthly?

Regular taxpayers, including those enrolled in the Quarterly Return Monthly Payment (QRMP) scheme, are obligated to pay GST on a monthly basis. This applies to businesses regardless of whether they opt for quarterly return filing. However, small taxpayers have the flexibility to choose the composition scheme if their annual aggregate turnover is within the prescribed limits of Rs. 1.5 crore for manufacturers/dealers and Rs. 50 lakh for pure service providers. Under the composition scheme, they can file a quarterly statement-cum-challan and pay taxes on a quarterly basis.

Why is Filing GST Returns Important?

Filing GST returns serves several crucial purposes, making it an essential aspect of compliance for businesses:

• Accurate Tax Reporting: GST returns allow businesses to report their input and output tax accurately, ensuring proper calculation of tax liabilities.
• Input Tax Credit Claim: Timely and accurate return filing enables businesses to claim input tax credit, reducing their overall tax liability.
• Transparency and Accountability: GST returns promote transparency and accountability in the taxation process, preventing tax evasion and ensuring fair practices.
• GST Refund Claims: Businesses eligible for GST refunds, such as exporters, need to file returns to claim their rightful refunds.
• Avoid Penalties: Failure to file GST returns within the specified deadlines can result in penalties and late fees, adversely affecting the financial health of businesses.
• GST Compliance Rating: Regular and accurate return filing contributes to a higher GST compliance rating, which can enhance a business’s reputation and credibility.

Filing GST returns is a mandatory and integral part of the GST framework, ensuring accurate tax reporting, input tax credit claim, and overall compliance. Various categories of individuals and businesses, including registered taxpayers, composition scheme participants, and e-commerce operators, must adhere to the return filing requirements.

By understanding the significance of timely return filing, businesses can avoid penalties, claim refunds, and contribute to a transparent and efficient taxation system. As the GST landscape evolves, staying informed and proactive in return filing remains essential for maintaining a strong financial footing in the dynamic business environment.

Why is Filing GST Returns Important?

Filing GST return Filing serves several crucial purposes, making it an essential aspect of compliance for businesses:

Number of GST Returns to Be Filed

The number of GST returns that a business is required to file depends on various factors, including the nature of the business, type of registration, and turnover. Here’s a breakdown of the different types of GST returns:

• GSTR-1 (Outward Supplies): Businesses need to file GSTR-1 to report details of their outward supplies of goods and services. This return is filed monthly, except for small taxpayers who have the option to file it quarterly.
• GSTR-2A (Auto-Drafted Return): GSTR-2A is an auto-generated return based on the details filed by the supplier in their GSTR-1. Businesses need to review and reconcile this return with their own records.
• GSTR-3B (Summary Return): GSTR-3B is a summary return where businesses need to report their total outward supplies, input tax credit, and calculate the net tax liability. This return is filed monthly.
• GSTR-4 (Composition Scheme): Small businesses opting for the composition scheme need to file GSTR-4 on a quarterly basis. It includes details of supplies, tax payable, and payment of tax.
• GSTR-5 (Non-Resident Taxpayers): Non-resident taxpayers need to file GSTR-5 to report their inward and outward supplies during their period of activity in India.
• GSTR-6 (Input Service Distributors): Input Service Distributors need to file GSTR-6 to report the details of input tax credit distribution to recipient units.
• GSTR-7 (TDS Deductors): Businesses deducting Tax Deducted at Source (TDS) need to file GSTR-7 to provide details of TDS deducted and deposited.
• GSTR-8 (E-commerce Operators): E-commerce operators are required to file GSTR-8 to report the supplies made through their platform and collect tax at source.
• GSTR-9 (Annual Return): All regular taxpayers need to file GSTR-9, an annual return, providing a comprehensive summary of their annual activities and reconciling the information filed in other returns.

The number of GST returns that a business needs to file varies based on its nature and registration type. Understanding these different types of returns underGST and their respective due dates is crucial for maintaining GST compliance. By staying informed about the specific returns applicable to your business and adhering to the filing deadlines, you can navigate the GST landscape successfully and contribute to a transparent and efficient tax system. As the GST framework continues to evolve, a proactive approach to return filing remains essential for ensuring smooth business operations and compliance.

Late Fees for Not Filing GST Return on Time

The Goods and Services Tax (GST) has redefined India’s taxation landscape, bringing with it a comprehensive framework to streamline taxes. One crucial aspect of GST compliance is timely return filing. Failure to file GST returns on time can result in late fees and penalties. In this informative guide, we delve into the intricacies of late fees for not filing GST returns promptly, providing essential insights for businesses to avoid unnecessary financial setbacks.

Understanding Late Fees for Delayed GST Return Filing

Timely GST return filing is crucial to maintain compliance and contribute to the efficient functioning of the taxation system. The late fees for delayed return filing are designed to incentivize businesses to adhere to the prescribed deadlines.

Late Fee Structure

• For GSTR-1 (Outward Supplies) and GSTR-5 (Non-Resident Taxpayers): A late fee of Rs. 50 per day (Rs. 25 for CGST and Rs. 25 for SGST) is applicable for each day of delay. The maximum late fee is capped at Rs. 5,000.
• For GSTR-3B (Summary Return): Late fee structure for GSTR-3B is Rs. 20 per day (Rs. 10 for CGST and Rs. 10 for SGST) in case of NIL returns and Rs. 50 per day (Rs. 25 for CGST and Rs. 25 for SGST) for other cases.
• No Late Fee for IGST: It’s important to note that late fee provisions apply to CGST and SGST only. There is no late fee on Integrated GST (IGST) for delayed return filing.

Get a Free Demo – Best Billing and Invoicing Software

Penalty for Tax Liability Declaration

Apart from late fees, businesses with tax liability also face penalties for not declaring their liabilities in GSTR-3B on time. A penalty of 10% of the tax due or Rs. 10,000 (whichever is higher) is applicable.

Impact on Input Tax Credit: Delayed return filing can also affect the eligibility to claim Input Tax Credit (ITC). If returns are not filed, the recipient may face issues in availing ITC on the corresponding outward supplies.

Optimising Timely GST Return Filing

To avoid late fees and penalties for delayed GST return filing, businesses can adopt the following strategies:

• Calendar Reminders: Set up reminders for return filing deadlines to ensure timely compliance.
• Automated Software: Utilise GST-compliant accounting software that helps track deadlines and simplifies the return filing process.
• Professional Assistance: Seek guidance from tax professionals or consultants to ensure accurate and timely return filing.

Late fees for not filing GST returns on time serve as a reminder of the importance of adhering to prescribed deadlines. By understanding the late fee structure and its implications, businesses can ensure timely compliance, maintain eligibility for Input Tax Credit, and avoid unnecessary financial burdens. As the GST landscape evolves, a proactive approach to return filing remains vital for successful tax management and sustaining a healthy financial position.

The Goods and Services Tax (GST) has revolutionised India’s tax structure, introducing a unified tax regime that has streamlined taxation processes. A critical component of GST compliance is the accurate and timely filing of GST returns. In this informative guide, we delve into the step-by-step process of how GST returns are filed and submitted, providing businesses with a clear understanding of this essential aspect of taxation.